MCA (Merchant Cash Advance)
What is mca (merchant cash advance)? A merchant cash advance is a lump-sum advance repaid as a fixed daily or weekly debit from the business's bank account, priced as a flat fee rather than APR.
Full definition
MCAs price using a factor rate (e.g. 1.30) on the advance amount: a $50,000 advance at 1.30 means the trucker repays $65,000 regardless of term. Effective APRs frequently land between 40% and 100%+, making MCAs the most expensive cash-flow tool in trucking.
The trade-off: speed and access. MCAs fund in 24-72 hours, accept 500-FICO applicants, and require minimal documentation. They make sense as emergency liquidity but are rarely the right long-term tool.
Watch the daily debit. A debit too large for the cash-flow cycle can stack into a debt-trap of refinancing — the so-called "stacking" problem common in subprime trucking finance.